Teaching kids about the value of money is tough. Most parents do not know how or where to start. Suze Orman of the "Women & Money" podcast has a book that parents could use. It is a children's book entitled "The Adventures of Billy and Penny." She also has some games and exercises to help kids from ages two to 22 make money smarts feel manageable and digestible.
Now that you have a lot of time to spend with your little ones, it may be the best time to teach them about financial matters. It may be hard at first, so here are seven lessons parents could use to teach children the value of money.
Teach children to have fun without spending cash
Orman stopped her niece, Alexis, from going out to buy crafts to entertain kids during the quarantine. She told People that she advised her niece to upcycle using empty milk-cartons and toilet paper.
Instead of buying expensive toys, explain to your kids that it would be safer to stay at home. If you plan to celebrate a birthday, you could try to make a Zoom party. Everybody could have fun as you teach your children money values.
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Declutter and teach children how to earn
Orman said that instead of throwing away things that you do not use, gather them together. Let your children bring our toys that they do not play with anymore. Put price tags estimating how much each toy costs.
Ask your kids if the toy was worth the cost and ask them if they would rather have that amount of money in their piggy banks. Children usually would agree on adding to their savings instead of having a pile of stuff they do not want.
The next time that you go out to the toy store remind them of this conversation so that they would not impulsively buy pricey toys. Orman said that you could bring the toys to no-contact donations. Your little ones would learn that they could help others without cashing out.
Home Economics
Teach your children about how much everything costs at home. You could allow them to guess how much each bill costs. For example, ask them to guess how much your internet bill each month or how much you pay for groceries.
Lay down your household expenses and explain to them how you earn money. Let your kids make money by helping you save from your monthly bills. For example, if they helped decreased your bill, divide the savings to them.
You are teaching them to be responsible, at the same time, and you are teaching them the value of money.
Let your children decide
If you have an ample amount of savings, no debt, and a paycheck is coming, include your kids in determining where to use the money. Ask them if they would like to spend, save, or share the stimulus money. Talk to your children on how to use it wisely.
If ever you need the money to survive, discuss them also with your children. You may seek their advice on which bill you need to pay first. Now is the best time to teach your kids about household costs, said Orman.
Teach them to be free from debt
Discuss how things work when using credit cards. Ask your children for advice on how to live a debt-free lifestyle. Your kids would learn that it would be better to spend money that they have rather than loaning.
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Teach your children to earn money
Teach your kids how the real world works, Orman said. Let them know that you get paid for what you have done. List down chores that your little ones could do and let them price each.
If they did not do well on the task, talk to them why they did not earn anything. Give the children bonuses when they did a better job. Orman said that you should give varying amounts to each task and let your kids start with the lowest pay.
By doing so, you teach your children that they should negotiate well, know their value, and put care and effort into their work to earn money.
